The taxpayer lost its appeal to the First-tier Tribunal in a case concerning the deductibility of expenses under ITEPA 2003, s. 338 and 339 (Mainpay Ltd v HMRC [2023] UKFTT 16 (TC)).
Mainpay is an umbrella company supplying temporary staff in the education, health, social care and other sectors.
The company argued that as it engages workers on the terms of an ongoing contract, each of the places where the workers carry out an assignment is a temporary workplace (or at least is not a permanent workplace). As a result, the company argued that the reimbursement of travel and subsistence expenses was deductible from the individual’s earnings for the purposes of income tax and NICs.
HMRC, on the other hand, argued that each assignment undertaken by a worker was a separate employment involving attendance at a permanent workplace and that travel and subsistence expenses were not therefore deductible at all.
(There were related arguments about dispensations.)
The FTT agreed with HMRC’s arguments in this case. The lengthy judgment will need careful analysis by anyone wishing to rely on it.
https://www.bailii.org/uk/cases/UKFTT/TC/2023/TC08678.html
Related content from Claritax Books
In Employment Status, author David Kirk guides the reader through the maze of apparently contradictory case law on this topic. The book includes coverage of IR35 issues, and also of topics of officers, agency workers, personal services companies and special occupations.
